Job Discussion Forums

[biffinbridge]

I've just been looking at flat prices in Poznan and a new build 2 roomed 52m flat costs between 60 and 80 thousand UK pounds. That's just the shell....so you'd have to decorate it too. there are many places in the UK where you can get a pokey, little flat for that.
Has the bubble burst or are prices set to continue in this direction? Seems mightily expensive for the salaries on offer there.
Are the local papers any better for finding places?
Also, I had a look at other towns eg Zielenia Gora, Torun and the flats there were much, much cheaper.-Is there rhyme or reason to it all....or is it just institutional investors buying up swathes of property?
Kymro...u must know:)

[Kymro]

Yes, there has been investment from abroad.

A bubble ....... about to burst.

Polish wages cannot sustain these prices.

[Sgt Bilko]

Gazeta Wyborcza does a price comparison every three months and, as far as memory serves, the last one showed that Krakow and Warsaw prices were actually standing still or slightly falling whereas in some of the cheaper towns prices were still rising. I remember being shocked that the tri-city area was almost as expensive as the two aforementioned. Sorry, I took no notice of poznan prices so can't help there.

[patrykt]

I have a lot to say on this topic, but don't want to type everything out here.

I got lucky and bought a place super cheap just off the Rynek in Poznan eight years ago, and now I just got unlucky by buying a very expensive place in June that needs to be renovated. It's in a great location with a lot of potential, but it burns me to pay the amount that I did, especially since it needs to be renovated. I don't know if I'll come out ahead on this one.

I am currently working outside of Poland for a couple of years with the intention of returning, but the cost of living in Poland makes me so angry. I can live in an expensive place, but I want something for it. You live in Denmark, you get great social, health and education systems. What do you get in Poland? Dog**** everywhere on the sidewalks and long hours for little pay. I dread the thought of my kids going to school there. Why am I returning? Polish wife.

Getting back to the issue; they say that real estate is supposed to keep going up, but it seems to have slowed down for the time being. The word is that when the euro hits Poland there will be another bump. I don't see how is can though.

Good luck

[scottie1113]

[JPM]

I'm in the process of buying a flat in Krakow. Whilst the prices are very high, they have dropped about 10% over the winter as it's now the top of the market. As there are few buyers right now, it's a good time to negotiate on prices.

However, in my opinion, prices will rise again later this year and the next, especially away from the major cities which are currently the most expensive, as Poles begin to come back from abroad having saved a wad of cash which they might well invest in buying or renovating a flat.

[phantombedwetter]

Very true JPM,
Don't listen to anyone who says there will be a crash, that is pure underpants, started by tin-foil hat wearers and conspiracy theorists in pseudo Irish pubs.

There will always be 'Corrections' which is connected to interest rates and far too complicated (And boring) to go into here.
The prices will continue to rise, albeit at a slower pace than the phenominal growth of the last four years.

Reasons for this include; people living longer (Less properties becoming available), growing prosperity, inward investment....etc
However, the big one is the amount of money tied up in mortgages at the moment which can't have the rug pulled out from under it.

I can get very boring about this subject so if you want more examples PM me.

I bought two plots of land and took mortgages for two properties last year when prices peaked and could could still rent out the properties to cover the mortgages (As prices increase so does rental value).

Crash? pure dog toffee.

[biffinbridge]

Good input from everyone and differing views.

I have an Economics degree and fully understand the 'cobweb' market phenomena, where demand and supply are out of step. I also understand that the situation has been exaggerated because of inward investment, more available credit and Poles remitting money from abroad. The Polish guy I tutored in 2006 had his finger in the propery development pie. My guess is that prices might stabilise, but in the long run will rise in real terms- for the investor your cash will be better off in bricks and mortar than a savings account . The things that could screw it up are the sub prime thing, a bad oil spike /recession and an appreciation of the Swiss Franc as lots of mortgages have been sold in CHF.

Who knows?...we'll just have to wait and see. Personally though I think Poland no longer gives value for money. Paying 400,000Zl for a pokey 50m2 flat just aint worth it when I can buy a beautiful villa on the beach in Thailand for the same money. I'm on a rotation with an oil company, so I could easily spend a few of my hols a year in Polska and a few in the Far East. What wrankles me is that the workmanship isn't even that great in Poland....it's all presentation and no content (like a lot of other things there)...hence my Polish goods and quality rant.

How do you explain the other apparent inflation in Poland? It's not wage inflation driving up the price of your pint and I doubt brewers have doubled their supply prices. My guess is that it's rent payments that businesses are now having to pay. Same goes for all sorts of other products. A buddy of mine was telling me only last year about the cost of his beer garden in the rynek in Poznan and how much he was charged/m2 and how it had almost doubled.

If and when I buy there..I'll just pay what it costs. Tuff shite really.

[sparks]

It's hard to believe that even attached houses on the outskirts of or near Warsaw are starting at close to 1,000,000 zloty for stan deweloperskie (concrete, glass and pipes). Can the price really increase any more? The idea of buying a home anywhere near the city seems out of the question for anyone but the ultra-rich. I really don't see who will pay such prices, even if people are returning from England with a few pounds saved up. I hope that Kymro is right and that the bubble will burst or at least deflate a by a few hundred thousand zloty. Otherwise my dreams of homeownership will never be realised.

[biffinbridge]

Another scary factor is that the big blocks weren't built to last and they'll all have to come down in the next 10 years or so. The guy I taught built a block of 36 flats in Warsaw in 2006 and my guess is that people like him are also buying loads of property and taking a punt on prices.

I never though I'd see the day when a drink in Poland cost what it cost in the UK and I certainly didn't anticipate a shittea little flat made of breeze blocks and plaster boards costing 60-80 grand on the edge of town.

I know loads of TEFLERS in Poland and just about every one of them is flat broke. One or two have got flats...but you can't sell them...it'll only cost you more to move.

What about the Ukraine...better looking women, cheaper beer...? We'll all end up in the friggin Urals at this rate:)

[scottie1113]

I doubt very much that the big blocks will come down in the next ten years or so and I don't think we'll see a real estate crash, just a correction like I've seen so many times in the US, but in the long run prices will continue to rise. They always have.

Where in the world do you drink that you have to pay UK prices for a beer? At my usual hangout, one of the more popular places in Old Town Gdansk, I pay 5 zl for a pint. Yes, I'm a regular but the price is only 6 zl for anyone else. I know lots of places like that, and even on the main drag by Neptune's fountain it's only 7 zl. I pass an Irish pub every day on my way to and from school. I'm told Guiness is 12-14 zl there but why would I want to pay that, let alone go there? I didn't come to Poland to hang out in a bar full of drunk expats paying inflated prices fro beer from the old country. That's what a found on my first and only visit to the Language Pub in Sopot. I'll just stick with my local inexpensive haunts in Gdansk.

End up in the Ukraine? I don't think so.

[sparks]

The building and tearing down phenomenon is real, at least in Warsaw. There was a new hotel, I believe, right behind Zlotych Tarasy in the center they just finished tearing it down a few months ago and started building something else. There is something temporary about all the new complexes they are building, the houses as well. Many of them don't have basements and seem rather flimsy. Construction isn't what it used to be in Europe.

[Mike_2007]

In my opinion prices will continue to slowly rise, at least that's the case in Romania, which has a pretty similar profile to Poland. The banks own everything, the house prices are controlled by what the banks are likely to lend the buyer. It's in the banks' interest to have everyone on a mortgage, and it's in everyone's interest to own a property rather than wasting money on rent. As a result, house prices will level off at a value where the owner of that particular property can buy it.

For example, my flat is a two-room, semi-central, reasonably sized flat close to the metro and in an ok part of town. Most of the people I've seen moving into my block are young professional couples. Therefore the price of the flats in my block will naturally settle at about what a professional couple, with a deposit saved, would be able to mortgage. In Romania that would probably mean around 130-150'000 Euro. This certainly seems to have happened, with the current value being around 120'000 Euro but now creeping up much more slowly than the previous year. If wages continue to rise here, the property prices will rise with them.

I'm sure a similar thing is happening in Poland. Either way, properties aren't cheap here either anymore. They are still worth buying, but you're not going to make the killing you could have made five years ago. Plenty of nice holiday homes in the country though.

Cheers,
Mike

[biffinbridge]

In response to a couple of posts:

1. House price inflation is 99% of the time greater than wage inflation.
2. If you did a curve of income distribution, it would be heavily skewed in terms of % of population toa fairly low income bracket. This is what makes the scenario in Poland so scary. What if the Swiss Franc appreciated 10%, where would all those Zloty earning mortgage holders be then? Look at the Euro right now...it could, however unlikely, happen.

3.Scottie...the going rate for a Polish beer in any of the bars in Poznan rynek is 9-12 Zl a pint . There are no Irish pubs there thank god. If you want a bar full of Polish people speaking with Irish accents and doing the gig, go to Brogan's or the Dubliner. The former is relatively new and actually quite a laugh...the latter was one of the original expat hangouts in the mid 90's and has died a death as it isn't even near the rynek and the menu hasn't changed in a decade. A shot of whisky can cost anything between 18 and 118 Zl a shot in Poz. None of the rynek places are studenty and all cater for the numerous international business fairs that take place there. Even Poles consider Poznaners to be gold digging bstards. The studenty bars are cheaper (off rynek) and if you're ever in Poznan check out Dragon (excellent late night drunken fun), Stary Kino, Pod Minoga or Stajenka. Pub BSA just off Polwieska is also ok for the footy. Quite honestly, the rynek is full of plush bars the likes of which you'd struggle to find elsewhere in Poland. I use Faxe, Room 55 and the Lizard King but my fave was Harry's, sadly now no more.

Eating out is very much the 'you get what you pay for' experience. Good restaurants include Stary Ratuszowa, Faxe and Tapas on the Rynek and Valpolicella, just off the Rynek. Others are dotted about. When I'm on holiday there, I give myself a budget of about 300zl a day for food, booze and buying stuff...the hotel is on top of that of course. Needless to say, sometimes I spend a lot more especially when I'm drinking with round shirkers like the Poles and teachers, (I stress teachers), from Uncle Sam, who have very long pockets and very short arms:) Dating is also expensive in Poland as you, no doubt, already know. Funny how Polish girls drink beer before you chat them up and whatever costs a fortune once they're in the bag. The other Polish round shirking excuse I love is the 'you invited me to the pub so you pay' chestnut.

So, back to Polish girls. Yep they're beautiful but generally speaking I find them feckin nuts. How many have you deflowered who have been in long term relationships? How many buy a drink or choose a mid priced item of clothing when you're treating them. How many suddenly develop tastes that they could only have read about in magazines? Back in the 90's we used to call them 'schemies'...they're actually an expat kind of groupie. There is no other explanation to the 'gorgeous young Polish girl, mid 30's expat, beer monster' conundrum.
It's great and we TEFLERS are generally the 'shallowest Hals' around on that score. Think Paris, think the Moulin Rouge, the Eiffel Tower, the Seine. Think New York, think amazing restaurants and fantastic shopping. Think Vienna, think amazing architecture. Think any big city in Eastern Europe, think booze, t1ts and teeth. That just about sums it up.

So why do we stay or indeed go?...Simpe, do the test. If you are a man, look at yourself in the mirror and then think of your last half a dozen conquests in Poland. Then ask yourself if you could have done that back home; that's why you stay. If you're an expat woman, look at the first 10 Polish girls you see and compare yourself to them and ask yourself if you can compete; that's why you leave after one year.(You only stayed that long because you signed the contract). ha ha ha.

[Kymro]

Biff, go to your inbox, m8.